Why are people obsessed with getting a pension

olestoepoke

Im 45 and have no pension. Emigrated in my early 20s and worked in various places abroad, Spain, USA and England. Returned recently with little or no savings and have just started working here in Ireland again. Is 45 too late to start a pension? Am I doomed?

olestoepoke

olestoepoke wrote: »

Im 45 and have no pension. Emigrated in my early 20s and worked in various places abroad, Spain, USA and England. Returned recently with little or no savings and have just started working here in Ireland again. Is 45 too late to start a pension? Am I doomed?

No not doomed. But to achieve a certain income at retirement you will now have to start saving a lot more per month until you retire, that you would have done had you started saving 20 years ago.
Saying that, if you have sorted say your house, i.e. mortgage paid off have a good income, saving now shouldn’t be too much of a hardship

Check out the pensions calc here
https://www.zurich.ie/pensions-retirement/calculators/pension-calculator/

screamer

I don’t trust the government one ounce with pensions. People say it’s 40 percent free.... at the moment it is, but will it still be when we retire? Will pension income be taxed to death to make up for shortfalls of the unsustainable social welfare society we are propping up, when the tax payer ratio drops from 5 to 1 to 2 to 1????? I stick to the old saying if something is too good to be true it usually is.

Wanderer78

screamer wrote:

I don’t trust the government one ounce with pensions. People say it’s 40 percent free.... at the moment it is, but will it still be when we retire? Will pension income be taxed to death to make up for shortfalls of the unsustainable social welfare society we are propping up, when the tax payer ratio drops from 5 to 1 to 2 to 1????? I stick to the old saying if something is too good to be true it usually is.

There's no guarantee in pensions, no matter if it's publicly or privately backed, and we don't have a social welfare society, with the majority of citizens engaged in employment

Ken Tucky

Interesting thread this.
I see they are now going to take your wages and force a pension upon you. Never mind the small businesses that will have to match your contribution.
In my opinion it will kill any chance employees have in getting any sort of pay rise.
Please correct me if I'm wrong.
In my case I don't have a pension. It's too late to start now to have any meaningful pension at my age.
I'm mid 40's and have worked all my life.
Is that not my contribution to a state pension??
I have a plan also, it didn't include putting into a poxy pension that won't be of any value to me.
State pension would have done. And yes I do believe if you have contributed as a worker for most of your life, you deserve it

State pension is unchanged

celtic_oz

heres an annoying 24 year old!

https://www.youtube.com/watch?v=rntvWD0yVfI

PaulieC

Pensions aren't really tax free. They are just tax deferred, as you get taxed on the other end when you start drawing it down. I must admit I am a bit dubious about the whole mandatory pension thing. Surely we already paying a mandatory pension with PRSI and USC ? There was plenty of money in the pension pot 10 years ago, about 20 billion and that's gone. Not on pensions mind you.

Wanderer78

celtic_oz wrote: »

heres an annoying 24 year old!

it ll be interesting to see what happens these folks when they realise theres no such thing as freedom on this planet

Ken Tucky

Augeo wrote: »

State pension is unchanged

That's for now. 20 years time it won't be sustainable.

Squall Leonhart

PaulieC wrote: »

Pensions aren't really tax free. They are just tax deferred, as you get taxed on the other end when you start drawing it down. I must admit I am a bit dubious about the whole mandatory pension thing. Surely we already paying a mandatory pension with PRSI and USC ? There was plenty of money in the pension pot 10 years ago, about 20 billion and that's gone. Not on pensions mind you.

Tax deferred yes, but there's a good chance you won't be in the higher tax bracket from your pension income, so if on 40% rate now it is very tax effective as you'll "only" be paying 20% on draw down

screamer

Squall Leonhart wrote: »

Tax deferred yes, but there's a good chance you won't be in the higher tax bracket from your pension income, so if on 40% rate now it is very tax effective as you'll "only" be paying 20% on draw down

Now.... yes, who knows in 30 years time. Perhaps all of it will be taxable at 40 percent. They can do anything and generally will to pay the over inflated public sector pensions and social welfare.
If you look at the statistics, 2 workers for every pensioner, we’re either due a huge drop in population or a massive rise in pensioners. That should sway the way people invest their future funds, and if you look at what some of these pension funds invest in, they’re in for a rocky ride.

Geuze

screamer wrote: »

I don’t trust the government one ounce with pensions. People say it’s 40 percent free.... at the moment it is, but will it still be when we retire? Will pension income be taxed to death to make up for shortfalls of the unsustainable social welfare society we are propping up, when the tax payer ratio drops from 5 to 1 to 2 to 1????? I stick to the old saying if something is too good to be true it usually is.

When you say 40% free, you are probably referring to the 40% tax relief available on pension conts.

No, this situation is not guaranteed to exist forever.

And yes, the Old-Age dependency ratio OADR is moving upwards slowly but surely.

Geuze

Wanderer78 wrote: »

There's no guarantee in pensions, no matter if it's publicly or privately backed, and we don't have a social welfare society, with the majority of citizens engaged in employment

Note that close to 50% of the pop were on welfare recently, it's now between 45-48% approx.

Geuze

Ken Tucky wrote: »

Interesting thread this.
I see they are now going to take your wages and force a pension upon you. Never mind the small businesses that will have to match your contribution.
In my opinion it will kill any chance employees have in getting any sort of pay rise.
Please correct me if I'm wrong.

You can opt out if you wish.

Yes, it may affect pay rises.

Wanderer78

Geuze wrote: »

Note that close to 50% of the pop were on welfare recently, it's now between 45-48% approx.

yea its clearly obvious, we have a serious problem brewing here, and it seems to me, nobody really knows what to do about it

Henry Ford III

PaulieC wrote: »

Pensions aren't really tax free. They are just tax deferred, as you get taxed on the other end when you start drawing it down. I must admit I am a bit dubious about the whole mandatory pension thing. Surely we already paying a mandatory pension with PRSI and USC ? There was plenty of money in the pension pot 10 years ago, about 20 billion and that's gone. Not on pensions mind you.

Tax relief on contributions. No tax on employer contributions. Tax free growth. Tax free lump sum.

Lots of advantages.

Geuze

PaulieC wrote: »

Pensions aren't really tax free. They are just tax deferred, as you get taxed on the other end when you start drawing it down. I must admit I am a bit dubious about the whole mandatory pension thing. Surely we already paying a mandatory pension with PRSI and USC ? There was plenty of money in the pension pot 10 years ago, about 20 billion and that's gone. Not on pensions mind you.

Yes, tax deferred, although effective tax rates in retirement are often very low.

My parents got up to 48% tax relief on their conts, and they now pay 8% approx income tax on their pension incomes of 48k approx.

Yes, we already have the PRSI-based SPC.

Note that the funds in the NPRF were used to re-capitalise several banks, so we now have stakes in these banks.

Geuze

screamer wrote: »

Now.... yes, who knows in 30 years time. Perhaps all of it will be taxable at 40 percent. They can do anything and generally will to pay the over inflated public sector pensions and social welfare.
If you look at the statistics, 2 workers for every pensioner, we’re either due a huge drop in population or a massive rise in pensioners. That should sway the way people invest their future funds, and if you look at what some of these pension funds invest in, they’re in for a rocky ride.

Note that PS pensions are now much less generous:

(1) PS workers have been paying the PRD for the last decade, typically 10% of wages, on top of the normal 6.5% cont

(2) PS pension is now based on career average earnings CARE



Note that the OADR is not 2 to 1 yet

Jim2007

Wanderer78 wrote: »

yea its clearly obvious, we have a serious problem brewing here, and it seems to me, nobody really knows what to do about it

Oh we know what to do, it's just that no one wants to bring home the had news.

Jim2007

Ken Tucky wrote: »

Interesting thread this.
I see they are now going to take your wages and force a pension upon you. Never mind the small businesses that will have to match your contribution.
In my opinion it will kill any chance employees have in getting any sort of pay rise.
Please correct me if I'm wrong.
In my case I don't have a pension. It's too late to start now to have any meaningful pension at my age.
I'm mid 40's and have worked all my life.
Is that not my contribution to a state pension??
I have a plan also, it didn't include putting into a poxy pension that won't be of any value to me.
State pension would have done. And yes I do believe if you have contributed as a worker for most of your life, you deserve it

It does not matter what you believe the reality is it will not be there. Now you have about 25 to 30 years to go, so yes you have time to save, put a pension in place and have some change of an enjoyable retirement. The choice is yours.

The alternative is to think about moving abroad to a country where your money will go further - may be somewhere like Croatia and join all the other expat pensioners that can't afford to live in their own country.

Wanderer78

Jim2007 wrote:

Oh we know what to do, it's just that no one wants to bring home the had news.

...and what is that?

howamidifferent

The reality is that those of us who work for 45 years paying PRSI and USC will end up giving our rights to a state pension to those who never worked, we will be means tested and told "Oh!, you had the foresight to save for your retirement? " Well John & Mary down the road didnt so we are giving your pension to them as you have your own private one!

Squall Leonhart

howamidifferent wrote: »

The reality is that those of us who work for 45 years paying PRSI and USC will end up giving our rights to a state pension to those who never worked, we will be means tested and told "Oh!, you had the foresight to save for your retirement? " Well John & Mary down the road didnt so we are giving your pension to them as you have your own private one!

This.. This is just one of those fears I too have. I cannot emphasise how sickened I will be if this happens to people who have had the diligence, foresight and sacrificed all along the way to be able to build their pensions, only to be told by the government of the day "you're sorted, you have your own, none from us", while it's given to those who lived with abandon all along.
The injustice of it would be sickening.

howamidifferent

And it will happen as our politicians sail off into the sunset on their 4, or 5 pensions from being on various committees, they won't give a **** about right or wrong they will screw the person who tried to look after themselves in retirement counting on the contibutary pension to bolster their meager private pension. Your contibutary pension will go to the likes of Margaret Cash Et all.

donkey balls

Myself personally think that people who have paid into a pension over the last few years is all they are going to get within the next 20 years, If the state pension is even still here in 20 years time the govt will have some sort of means testing on it that people who acted in a prudent way will be punished.
This all ready happens regarding people getting made redundant the DSW will not entertain someone signing on as they have got paid off from a company probably after working 30+ years.

Squall Leonhart

Jobseekers benefit isn't means tested, and is yours if you have built up your PRSI contributions.

Jobseekers allowance is means tested. When your JSB runs out you won't get JSA if you've received substantial sum in severance, or have savings etc.

AndrewJRenko

howamidifferent wrote: »

And it will happen as our politicians sail off into the sunset on their 4, or 5 pensions from being on various committees, they won't give a **** about right or wrong they will screw the person who tried to look after themselves in retirement counting on the contibutary pension to bolster their meager private pension. Your contibutary pension will go to the likes of Margaret Cash Et all.

What committees pay pensions?

Do you think that politicians of the future will care about the grey vote, like politicians of today?

Wanderer78

Squall Leonhart wrote:

Jobseekers allowance is means tested. When your JSB runs out you won't get JSA if you've received substantial sum in severance, or have savings etc.

Hide it

Squozen

Until the age of 35 I was living paycheck to paycheck, but because I was in Australia I was in a compulsory pension scheme (they call it superannuation). Now at the age of 46, even though I was making terrible money when I was young, I have €120k in my pension and will be able to retire at 60 (and I've budgeted assuming that state pension won't exist by the time I'm 68). My Australian pension is increasing by about €13k a year already without me putting anything extra into it.

The average retirement age in Australia is 55, in Ireland it's more like 66. The pension is the reason for this and you're a mug if you don't take advantage of it. It's FREE MONEY.